May 28, 2013
Lexin Murphy
Senior Environmental Specialist
Mecklenburg County Waste Reduction and Recycling
700 N. Tryon St.
Charlotte, NC 28202
Re: Potential Economic Impact of Lowering the Threshold of the Source Separation
Ordinance
Dear Lexin:
This letter report is intended to update DSM Environmental Services, Inc. (DSM’s) May 2011
report, Economic and Environmental Impacts of Select Changes to the Source Separation
Ordinance.
You have provided DSM with a list of small businesses willing to participate in a survey of their
waste and recycling generation and costs, as well as a list of waste and recycling haulers willing
to discuss their services with DSM. We have called all of the companies on the list. For the small
businesses we have made 5 attempts, and then have stopped if they still did not respond. For the
haulers we made two attempts and then stopped. We made less of an attempt with the haulers
because it became clear after surveying four of the seven that all of their prices were similar and
that we could draw conclusions from the four we spoke with.
In total we were able to reach and survey 28 businesses. Of those 28, five (highlighted in yellow
in Table 1 below) appear to fall below the proposed 8 cubic yard cut-off, and seven (highlighted
in green) report generating 16 cubic yards or more per week (and therefore might be covered
under the current SSO), leaving 16 who appear to fall within the range of business
size/generation potentially affected by the proposed change to the SSO. Note that we say
“potentially” because we are asking them to tell us what size dumpster they have. They may or
may not actually know. We have tried to prompt them by asking for rough dimensions and in
several cases we have had them actually check their invoice and get back to us, but in many
cases it is just their best guess.
Updating Best Estimate of Potential Impacts
DSM has taken the following steps to update our May 2011 report.
First, we have only concentrated on the estimated 3,600 businesses that generate between 8 and
16 cubic yards of refuse per year based on our review of the BusinessWise database provided to
DSM in 2011. Businesses generating 16 cubic yards or more per week are required to separate
materials now and therefore are ignored, whether or not they comply with the existing ordinance.
1
Second, we have used the survey results to estimate what small businesses are currently paying
for refuse and recycling. However, we have not relied solely on the survey responses to estimate
what percent of small businesses might be impacted by the change in the SSO. This is because
there is an inherent bias in surveying from a self-selected group which is supposed to be
representative of the population.
Third, we have concentrated on the cost of adding recycling, not on the cost of refuse collection
and disposal. This is because, as we state in our 2011 report, the reported cost of refuse
collection and disposal varies widely both because of differences in density of waste among
generators, but also because of how aggressive the business is in seeking competitive bids for
refuse collection and disposal. Customers who have been with a contractor for a long time may
have experienced annual cost increases that have made their service significantly more costly
than if they have recently asked for competitive prices. These variables reduce the value of the
reported cost of refuse collection and disposal.
Synopsis of Previous Report
Table 6 (page 19) of DSM’s May 2011 report estimates that 3,600 businesses would be
potentially impacted by amending the SSO to require that all businesses generating over 8 cubic
yards per week be required to recycle corrugated containers, as opposed to the current ordinance
that requires all businesses that generate 16 cubic yards or more of refuse per week to recycle
corrugated containers.
The estimate of 3,600 businesses was developed by applying the survey results of the Skumatz
Economic Research Associates analysis of business recycling in Mecklenburg County (Recycling
Study Targeting Small Businesses in Mecklenburg County, November 6, 2008) to the more
accurate BusinessWise Database of Mecklenburg County businesses available to DSM in 2011.
Of the estimated 3,600 businesses that could potentially be impacted, DSM estimated that 53%
of those businesses were already recycling based on the telephone survey conducted by DSM in
2011, leaving an estimated 1,700 additional businesses that would be required to add recycling
due to the change in the SSO.1 Based on limited survey data, DSM estimated that the average
business would have to pay $78 more per month to recycle, for a total estimated gross cost of
$1.5 – 1.6 million.
However, DSM’s surveys indicated that 28 percent of the small businesses surveyed in 2011
would be willing to drive their recyclables to a LUESA recycling container, where the
recyclables could be dropped off at no cost (other than driving cost). This reduced the total gross
cost, before accounting from any avoided disposal cost savings to $1 – 1.1 million.
1
Also assumes elimination of the 500 pound per month OCC and office paper generation exemption.
2
Updated Estimate Based on Additional Surveying
Business Surveys
Mecklenburg County provided DSM with a final list of roughly 35 businesses who stated that
they would be willing to participate in a survey to update our 2011 report. Of this list, 28
businesses ultimately responded to our request and provided information over the telephone. As
illustrated by Table 1, below, of the 28, 13 appear to be businesses which would be impacted by
the change to an 8 cubic yard threshold for required recycling, with those highlighted in yellow
and green being too small, or already subject to the ordinance, respectively. Of those 13, 11
(85%) report that they already recycle corrugated containers and/or office paper; but three do so
through free County drop-off boxes.
Table 1: Summary of Survey Responses Survey #
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Category
Gas Station
Gas Station
Printing
Education
Contractor
Consultants
Consumer Advocate
Manufacturing
Food Service
Installer of machine equipment
Picture Framing
General Contractor
Food Producer
Real Estate
Commercial Real Estate
Engineering
Food Service
Oil Change
Retail
Marketing
Clothing Retail
Advertising
Gift Store
Distributor
Grocery
Crafts Store
Property Mgmt
Medical Services
Emp
3
8
5
28
25
2.5
10
47
11
8
2
7
17
21
8
3
5.5
8
2
5
3
30
2.5
23
20
4
425
35
Private Hauler
yes
yes
yes
yes
yes
City
incl
yes
incl
incl
City
yes
yes
Yes
yes
incl
incl
yes
incl
incl
yes
incl
yes
yes
Yes
No
Yes
Yes
3
CY trash
6
6
10
8
8
tote
16
12
24
10
tote
8
8
6
8
shared
8
6
16
8
3
16
16
6
16
shared
24
8
Recycle
MCSWD
Yes
Yes
MCSWD
No
No
Yes
Yes
Yes
Yes
MCSWD
MCSWD
Yes
Yes
Yes
Yes
No
Yes
Yes
No
MCSWD
Yes
Yes
Yes
Yes
Yes
No
Surveys of Haulers
DSM was provided with a list of seven haulers that had indicated they would be willing to be
surveyed by DSM. Four of the seven haulers called DSM back on either the first or second call
and were surveyed. The results for the four haulers were similar enough that it was decided that
there was no need to continue calling the other three haulers. In addition, Mecklenburg County
provided DSM with a survey from an eighth hauler which responded to the questions on
materials accepted, but not to questions concerning costs.
In general, four of the five haulers offer single stream collection of all recyclables (except glass
in some cases) accepted by either the ReCommunity or Sonoco MRF’s. One of the haulers
primarily collects corrugated containers (cardboard) only from their commercial customers, but
will offer single stream collection with toters if requested, and plans to expand its single stream
collection over the next six months. This hauler accepts the same list of materials as the other
three, but also included glass.
Table 2 presents the list of materials accepted by the haulers responding to the survey.
Table 2: List of Standard Recyclables Accepted by Responding Haulers
Material
Cardboard
Office Paper
Mixed Paper
Aseptic Packaging
Aluminum Cans
Metal Food Cans
Aerosol Cans
Plastic Bottles
Rigid Plastic Containers
Mixed Plastic Containers
Glass Bottles
Haulers Accepting
5
5
5
5
5
5
5
5
4
5
2
One of the haulers surveyed collects from “recycle-rich” customers (generators who primarily
generate materials that can be recycled, exclusive of organics) and therefore does not require
separation of recyclables from the MSW; instead separating the recyclables from the trash at
their recycling facility. Another one of the other haulers surveyed competes by offering
comprehensive recycling as part of their over-all service as a way to increase their competitive
advantage.
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In general, as discussed in the May 2011 report, and confirmed by both the business survey and
the hauler survey, there are wide disparities in refuse collection pricing depending on the type
and size of the business, and how active the business is in shopping for the best rate. Therefore, it
is difficult to attribute potential saving associated with recycling to a specific drop in refuse
collection costs because the collection costs are not driven primarily by volume.
However, it is interesting to note that the reported additional cost to recycle has fallen since
2011, to a reported range of $30 – 50 per month for a standard 6 cubic yard dumpster collected
once per week. This can be compared with an estimated average cost of $78 per month reported
in the May 2011 report. Therefore, all things being equal, the cost to recycle has fallen by
roughly 45 to 65 percent since May 2011 which means that the expected impact of a change in
the SSO has been similarly reduced.
And just as importantly, all of the haulers surveyed indicated that they are willing to accept the
full list of single stream materials (with the exception of glass in some cases) as opposed to only
corrugated containers; although obviously, if a company is a large generator of corrugated, they
would probably receive a better rate if they kept their corrugated separated from the other
materials.
Summary of Potential Impacts
DSM’s May 2011 report estimated that of the 3,600 businesses expected to be impacted by the
change in minimum generation from 16 cubic yard per week to 8 cubic yards per week, roughly
53 percent were already recycling and would therefore not be impacted by the change in the SSO
because they would already be in compliance.
If DSM were to use this most recent survey, the number of businesses already recycling would
be 85 percent. However, because these businesses self-selected to respond to the survey, DSM
believes that it is prudent (and more conservative) to stick with the previous estimate that 1,700
businesses would be required to add recycling under the change in the SSO. However, because
of the decrease in the average cost for recycling, the gross cost to Mecklenburg County small
businesses is estimated to now be an additional $816,000, minus potential savings to some
businesses associated with reduced pull costs of refuse.
According to several of the haulers surveyed, an estimated 25 percent of these businesses could
expect to see some savings – perhaps $20 to $25 per month in reduced pull costs. Using $20,
would reduce the total cost to small businesses subject to the change in the SSO to $715,000
(rounded) per year.
It should be noted here that the reported cost to recycle is highly dependent on the value of the
materials delivered to the MRFs. A significant downturn in materials prices could result in
higher costs to the affected businesses, while a significant increase in prices could further reduce
costs to the affected businesses.
5
Impact of Eliminating the Free County OCC Dumpsters
As illustrated by Table 1, three of the surveyed businesses generating between 8 and 16 cubic
yards currently rely on the County dumpsters. If these dumpsters were removed these businesses
would have to pay for recycling collection. We believe that the conservative estimate of 1,700
businesses which would be subject to the change in the ordinance accounts for this removal.
Therefore DSM has not changed the estimated total cost to Mecklenburg County small
businesses.
The Addition of Bottles and Cans
The average of all the businesses responding to DSM’s survey reported generating 77 PET
bottles, 54 aluminum cans, and only 14 glass bottles per month. Assuming that this is
representative of the 3,600 potentially impacted businesses and that a recovery rate of 50 percent
could be achieved, this would result in roughly 2.8 million new PET bottles and Aluminum cans
recovered from small businesses in Mecklenburg County. Glass bottles have not been included in
this estimate because some of the haulers do not accept glass bottles, and because the survey
indicated that there are very few glass bottles being generated, with many of the surveyed
businesses reporting no glass. It is DSM’s opinion that North Carolina’s requirement that bars
and restaurants with liquor licenses recycle glass bottles is the correct way to target glass
recycling from businesses.
Signed:
Ted Siegler
6